One of the first pay TV operations to fall victim to the current financial circumstances is Gateway Broadcasts Services, pan-African operation which tried to take on the Naspers owned Multichoice DTH operation in Africa with its own GTV service.
The company has ceased broadcasting, blaming the recession, mostly saying that new funding was too hard to come by, but the truth is perhaps that it only signed up 100,000 customers against a target of having 250,000 sometime this year.
The company was part of a Gateway group which included Gateway Communications an African telecommunications operator that was run as a separate financial entity, which recently sold out to Vodacom, the South African Vodafone affiliate.
GTV specifically avoided meeting Multichoice head on in its home market of South Africa, and only took on customers in Botswana, Kenya, Cameroon, Gambia, Gabon, Ghana, Lesotho, Liberia, Malawi, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe.
However a number of those subscribers are now up in arms because the company kept marketing subscriptions right up until the day it declared it would seek liquidation, and because most of these are pre-pay accounts, which would make the customers creditors.
During the past two years GTV said it spent some $200 million and much of its marketing was based around selling UK soccer games, which it had the lion’s share of rights to, ahead of Multichoice. Multichoice has now stepped in this week to buy out those rights for the current season and the following one, after they reverted to the UK Premier League, and will now offer discounted receivers to the existing customers of GTV.
At present this is being done without the aid of GTV, but Multichoice is probably the only business that could mount a serious bid to the liquidator for existing subscribers, and continue to supply them now that it has these key soccer rights.